Abnormal amyloid-β (Aβ) production and deposition is believed to represent one of the main causes of Alzheimer's disease (AD). γ-Secretase is the enzymatic complex responsible for Aβ generation from its precursor protein. Inhibition or modulation of γ-secretase represents an attractive therapeutic approach. CHF5074 is a new γ-secretase modulator that has been shown to inhibit brain plaque deposition and to attenuate memory deficit in adult AD transgenic mice after chronic treatment. To date, it is not known whether the positive behavioral effects of this compound also occur in young transgenic mice without plaque deposition. Here, we evaluated the effects of acute and subchronic treatment with CHF5074 on contextual and recognition memory and on hippocampal synaptic plasticity in plaque-free Tg2576 mice. We found that at 5 months of age, contextual memory impairment was significantly attenuated after acute subcutaneous administration of 30 mg/kg CHF5074. At 6 months of age, recognition memory impairment was fully reversed after a 4-week oral treatment in the diet (≈60 mg/kg/day). These cognitive effects were associated with a reversal of long-term potentiation (LTP) impairment in the hippocampus. A significant reduction in brain intraneuronal AβPP/Aβ levels and hyperphosphorylated tau, but no change in soluble or oligomeric Aβ levels was detected in Tg2576 mice showing functional recovery following CHF5074 treatment. We conclude that the beneficial effects of CHF5074 treatment in young transgenic mice occurred at a stage that precedes plaque formation and were associated with a reduction in intraneuronal AβPP/Aβ and hyperphosphorylated tau.